Tax Freedom Day is the day of the year when an individual has earned enough to pay his or her taxes; all earnings after that date belong to the individual. An earlier Tax Freedom Day means a lower tax burden, and a later Tax Freedom Day means a higher tax burden.
Professors James R. Harrigan and Antony Davies in 2012 developed “Deficit Day” to be similar to Tax Freedom Day. Every day up to “Deficit Day” the federal government can pay its bills, but every day after “Deficit Day” adds to the federal budget deficit. If there is no budget deficit, that day is December 31st (the end of the year). If there is a large budget deficit, “Deficit Day” is much earlier in the year.
“Deficit Day” was September 10th in 2012 and September 25th in 2013.
Real Clear Markets
September 10, 2012
Happy Deficit Day, America!
By James R. Harrigan & Antony Davies
Every year the Tax Foundation announces “Tax Freedom Day"-the date by which the average American has earned enough to pay his taxes for the year. This year Tax Freedom Day finally arrived on April 17th. That means that, if you are an average American, it will take every penny you earned from January 1st until April 17th to pay your taxes for the year. Only what you earn from April 18th on would be yours to keep. Today, the average American has to work 107 days, or almost 30 percent of the year, to pay for government.
We propose “Deficit Day"-the date at which federal tax revenues run dry and Uncle Sam begins racking up more debt. This year it falls on September 10th.
If the federal government were to spend the same amount of money each day starting on January 1st, it would run through all of its tax revenue by September 10th. Everything the government spent from then until the end of the year would be on credit.
If lawmakers produced a balanced budget, Deficit Day would occur on December 31st, when the government spent the last dollar of its annual tax receipts at the stroke of midnight on New Year’s Eve. But we haven’t seen a balanced budget since the Eisenhower administration.
James R. Harrigan is a fellow of the Institute of Political Economy at Utah State University, and Antony Davies is a professor of economics at Duquesne University in Pittsburgh.
Ryan S. Stowers
Great read #DeficitDay RealClearMarkets - Happy Deficit Day, America! http://bit.ly/O7KycD
4:00 AM - 10 Sep 12
Monday, September 10, 2012
Happy ‘Deficit Day’
One of my favorite economists, Professor Antony Davies, and his colleague, James R. Harrigan, suggest we also celebrate what they call “Deficit Day” to focus Americans’ attention on the on fact that we are headed to bankruptcy. They explain it all in an excellent article they published at Real Clear Markets.
“Deficit Day” is the date by which federal tax revenues run dry and the federal government begins adding even more debt on top of our exploding $16 Trillion national debt. This year Deficit Day falls on September 10th.
Happy Deficit Day, Uncle Sam
By JAMES R. HARRIGAN And ANTONY DAVIES
‘Deficit Day” is here again, marking the day the U.S. government runs out of money and begins adding to the nation’s already-enormous debt. Despite the $2.7 trillion the federal government collects every year from Americans in the form of income, payroll, corporate, estate and excise taxes, as well as tariffs, fees and other sources, on a calendar year basis the money runs out Sept. 25, at around 3 p.m.
Washington is spending at the rate of over $10 billion per day and from this point until Dec. 31 every dollar it spends will add to the nation’s debt—which is already nearly $17 trillion.
New York City • Government/Law/Politics • Tuesday, October 01, 2013 • Permalink